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Is one of this year’s biggest trading debuts around the corner? Chinese fashion giant Shein is at the center of new rumors today that it is planning an initial public offering (raised the possibility, citing anonymous sources “familiar with the matter.” The company has since denied that a Shein IPO is in the works. However, this raises more questions as to the fashion retailer’s future plans for going public.) in the U.S. in 2023. A report from Reuters first
Should investors be expecting to see Shein start trading in the coming year? Let’s take a closer look at the unfolding story and examine what we know so far.
Is a Shein IPO Coming Soon?
Summer 2023 has brought some exciting IPOs so far. Earlier in June, restaurant chain Cava Group (NYSE:CAVA) surged more than 90% on its first day of trading. This week brought several other exciting market debuts, including Savers Value Village (NYSE:SVV) and Kodiak Gas Services (NYSE:KGS). Given the early trading successes of these companies, it makes sense that firms would want to follow suit. That’s likely part of what has fueled the Shein IPO speculation.
Shein has managed to procure and retain a significantly large consumer base. The company remains a favorite fashion brand among millennial and Gen Z shoppers. Reuters notes that if it were to go public, Shein would be the most valuable Chinese company to do so since ride-hailing giant DiDi Global (OTCMKTS:DIDIY) made its trading debut with a valuation of $68 billion in 2021.
However, Shein has a questionable history that goes beyond today’s IPO debate regarding labor regulations and influencer marketing. As Mother Jones reports:
“Stealing brands from smaller designers? Those claims abound. Subjecting garment workers to awful working conditions, including dismally low wages for a 75-hour work week? Yep, that’s been alleged too. Disastrous effects on the environment? That too. Selling $15 dresses while being valued for billions? That’s a fact. Even Congress has stepped in to investigate, with a recent report finding Shein regularly relies on trade loopholes in order to avoid human rights reviews.”
What Comes Next
Despite the rumors of a Shein IPO, the company says there is no truth to speculation.
A spokesperson told CNBC that “Shein denies these rumors.” It seems that, at least for now, Shein won’t be going public before the end of the year, despite what Reuters’ sources have claimed.
The company also hasn’t provided much recent context on when it plans to make its public debut, if at all.
On the date of publication, Samuel O’Brient did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.